DexCom cited as bellwether

CNBC stock commentator Jim Cramer on Friday cited San Diego’s DexCom Inc. (Nasdaq: DXCM) as a bellwether for the stock market, which should go into a turnaround on Wall Street within the next year.

In an interview with TheStreet, Cramer said DexCom had a “disruptive” diabetes monitoring system that has been grabbing an increasingly large part of the market. But he said the stock price has plummeted recently because investors have been focusing more on earnings per share instead of cash flow.

Cramer said the main reason DexCom’s earnings have weakened is that it has been adding more salespeople, which will help generate more revenues. He said if the stock starts bouncing back, it could bode well for similar stocks, signaling that investors are once again focusing on companies’ broader fundamentals.

DexCom shares, which briefly crested above $49 in early March, were selling at $32.45 at noon on Wall Street on Friday, after gaining a boost from Cramer's comments.